UK INVESTMENT IN EGYPTAlexandria Chamber of Commerce, 21 January 2013

Presentation by Taher El SherifSecretary General, The EBCC

*

CONTENTS • Global investment in Egypt

• UK share of investment in Egypt

• Why invest in Egypt?

• UK/Egypt trade statistics

GLOBAL INVESTMENT IN EGYPT

*

EGYPT’S NET FDI (IN US$ BN)1980 - 2011

Source: World Bank

Egypt’s economic reform programme of 2004 creates a favourable investment environment in Egypt. Net FDI flourishes from 2005.

The 25th January revolution leads to a steep decrease in net FDI to US$ -1.108bn in 2011.

For the first time in 30 years, FDI outflows are higher than inflows.

EGYPT’S FDI INFLOWS(IN US$ BN)1980 - 2011

Egypt’s net FDI almost equals its FDI inflows. FDI outflows are minimal.

2011 is the first year that FDI outflows are higher than inflows, leading to a negative net FDI of US$ -1.108bn.

Source: World Bank

EGYPT’S FDI BREAKDOWN (IN %)

Establishment of new companies and expansions of companies in operation accounted for 42.9 percent of net FDI flows during the period from FY 2004/05 to FY 2008/09.

Source: Central Bank of Egypt

SECTOR DISTRIBUTION & SHARE OF EACH SECTOR IN TOTAL FDI IN EGYPT (US$ MN)

2009/10

% Share 2010/11

% Share

Manufacturing 456.3 4.1 803.9 8.4

Agriculture 261.6 2.4 30.4 0.3

Construction 303.8 2.8 108.8 1.1

Finance 873.9 7.9 114 1.2

Services 382.6 3.5 207.2 2.2

Tourism 246.9 2.2 158 1.7

Communications & IT

62.8 0.6 7 0.1

Real estate 305.3 2.8 134 1.4

Petroleum 7577.4 68.8 7014.7 73.3

Other 537.5 4.9 996.4 10.4Source: Central Bank of Egypt

FDI & PORTFOLIO INVESTMENT IN EGYPT IN%

Quarterly FY 09/10 – FY 10//11

Source: Central Bank of Egypt

UK SHARE OF INVESTMENT IN EGYPT

*

UK NET FDI OUTFLOWS TO EGYPT (IN £MN)1992 - 2011

Source: OECD Statistics

The total accumulated UK investment in Egypt reaches £5,686 over 20 years

Investment breakdown:Oil & gas - 60%Manufacturing – 15%Finance - 10%ICT - 8%Tourism – 5%Others – 2%

TOP INVESTOR COUNTRIES IN EGYPT IN %Q1 2011/2012

Inflows: US$2.69bn

Outflows: US$ 2.26bn

Net FDI: US$ 440.1mln

In Q1 of FY 2011/12 the UK invests US$ 1.3bn in Egypt.

This investment equates to 61% of total EU investment in Egypt (US$ 2.12bn).

Source: Central Bank of Egypt

WHY INVEST IN EGYPT?

*

WHY INVEST IN EGYPT?

Current circumstances

• Security concerns• New Islamic regime• Instable political situation• Shortage of government resources• Non-conducive investment environment

WHY INVEST IN EGYPT?

WHY INVEST IN EGYPT?

WHY INVEST IN EGYPT?

WHY INVEST IN EGYPT?

Jan-Oct ’11 Jan-Oct ‘12 % Change

Egypt Exports 700 525 -25

UK Exports 849 755 -11

Trade Volume 1,549 1,280 -17

UK Balance 149 230 +54

UK-EGYPT TRADE STATISTICS Jan-Oct YOY in £MN

World Ranking UK Exports

56 Romania

60 (-2 YOY) Egypt

61 Greece

World Ranking UK Imports

75 Argentina

76 (-7) Egypt

77 Kazachstan

THANK YOU

Presentation by Taher El SherifSecretary General, The EBCC

*